ETFs put Advisors in Driver Seat

The Wall Street Journal‘s Jonathan Burton explores the reasons behind the increasing popularity of exchange traded funds with financial professionals in “Financial Advisers Shift to ETFs“.

Burton points out that ETFs offer a lot of choices for advisors, highlighting the S&P 500 SPDR (SPY), the iShares MSCI EAFE Small Cap Index (SCZ), Market Vectors Solar Energy (KWT), PowerShares Lux Nanotech (PXN), and WisdomTree Dreyfus Indian Rupee (ICN) as examples of the wide variety of exchange traded funds that are available.

Burton also notes that many money managers are frustrated with the high fees and under performance of actively managed mutual funds.

Other reasons cited for the movement to ETFs by advisors include easy asset allocation and tax efficiency.

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